After a generally slow-moving 2017, the market price for Glucosamine started to pick up in Q4 and is now currently slightly higher than that of 2017. The new environmental protection tax is very likely to increase the Glucosamine factories’ cost, especially on water discharge since it requires more than 100 MT of water to produce 1MT of Glucosamine. We expect that the market prices will remain very strong in Q1 of 2018. Prices remain stable for Hyaluronic Acid. Chondroitin Sulphate pricing remains fairly static for material brought into the EU. More and more customers are demanding to see the CVED certificate as assurance that the material was legally imported.
The market price for ascorbic acid powder is relative stable although still high compared to 12 months ago. However, the supply of ascorbic acid derivatives such as the DC grade, Sodium and Calcium forms are in tight supply.
Blaming strong demands and surging raw material prices, the major Chinese producers raised the prices for B1 Thiamine HCl and Mono in early January. Vitamin B6 and B7 (D-Biotin) prices are currently stable at a high level. For Inositol, the market prices remain stable as well. However, the corn price in China has been increasing and as Inositol is produced from a byproduct of corn starch, there could be a price increase in the near future. Folic Acid, Cyanocobalamin & Methylcobalamin are stable, yet high compared to early 2017, while the price for Natural Vitamin E has started to increase due to the tight supply of synthetic Vitamin E.
Amino acids obtained by hydrolysis will continue to face environmental protection pressure. In addition, some of the traditional amino acids made by hydrolysis will face competition from fermentation, such as L-Cystine, Leucine and Arginine. Synthetic amino acids (such as Alanine, Aspartic acid, Carnitine and Glycine) will also have environmental protection issues. Refined amino acids from feed grade such as Tryptophan, Methionine, Lysine and Threonine are typical commodities in the feed market and prices could become more volatile going forward. With regard to the amino acids from fermentation, due to the strong environmental pressure more and more producers are transitioning from the hydrolysis method to fermentation. However, the annually renewed USP monograph, which has strict requirements on impurities, poses a formidable challenge to amino acids obtained by fermentation.
The botanicals market from China is changing due to increasing demand from customers for a higher quality end ingredient; this is due to the higher levels of control on pesticides, microbiological parameters and heavy metals in the EU. Despite a good harvest, the prices for Citrus Aurantium have been increasing due to the growing investment in environmental protection facilities; this has caused production costs to raise, including raw materials. Milk Thistle extract price remains stable, while the resveratrol market price remains high but the supply is less tight, which could lead to a price decline later on this year. Watch out for adulterated material sold in the market at cheaper prices we are seeing a lot of batches of Ginkgo Biloba failing due to being spiked.
From the 1st of February 2018, Chinese CIQ has claimed the government's inspections on most vitamins will be no longer necessary. To our knowledge, this declaration could bring profound changes for the traditional supply chain of vitamins. Since the CIQ Inspection has been cancelled by the government, goods will be out of the producers’ control as they do not need to acknowledge the destination of their goods. Therefore, different pricing for Chinese domestic market and foreign market will not make any more sense and there will be more dealers joining in the export to foreign market. This should cause prices to drop in the in near future: the price for most vitamins, unreasonably high at the moment may not last very long.
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